THE BOURSE WHISPERER: Intermin Resources (ASX: IRC) reached agreement with Saracen Mineral Holdings (ASX: SAR) to divest its interest in the Lehmans Gold Joint Venture.
Intermin Resources decided to divest the package comprising 14 tenements to the north of Saracen’s Thunderbox operation near Leinster in the northern goldfields of Western Australia and includes the Otto Bore deposit, located nine kilometres from the Thunderbox mill.
Intermin held a 10 per cent interest in the tenements, through its 100 per cent-owned subsidiary Black Mountain Gold Pty Ltd, and was free carried to a decision to mine.
The company also owned an exploration license to the east of the JV tenements on a 100 per cent basis.
The parties have now agreed to terminate the JV with Intermin agreeing to divest its 100 per cent interest in the exploration license to Saracen on the following terms:
Payment to Intermin of $250,000 in cash on execution (already received);
Payment to Intermin of $2.25 million in cash on completion;
A 2.5 per cent Net Smelter Royalty payable by Saracen once it has produced 42,000 ounces of gold from the transaction tenements, and ending once 100,000 ounces of gold produced from the transaction tenements;
Intermin to provide any required mining information to Saracen on the purchased tenement; and
Intermin and Saracen to be released from any rights and obligations under the joint venture agreement.
“Holding a minority interest in a project in the northern goldfields just didn’t make sense for Intermin and would be a distraction from the company’s core focus of building a gold business in the Kalgoorlie region,” Intermin Resources managing director Jon Price said in the company’s announcement to the Australian Securities Exchange.
“This will enable Saracen to explore and develop the projects unencumbered and further strengthen Intermin’s financial position as it continues with its gold exploration and mine development growth plans.”